97TURBO

Can anyone advise on this situation, the house we bought was a repossession, it had been marketed approx 40k under is true value. When we re-mortgage at the end of our fixed term, should the current lender or new lender base our LTV on its now true value and not what we paid for it?
hope that makes sense

piehole1983

iTrader: (7)

Should be valued on its true market value, what you paid is irrelevant. The same would apply if you had paid twice what it's worth initially.

stevebt

iTrader: (8)

If your re mortgaging then there should be less money on the loan than when you took it out so even if the property price has risen it will make no difference to a straight forward re mortgage.

andy97

iTrader: (1)

Beware of the new lending rules which could potentially scupper remortgage chances, especially if you're older than 50

97TURBO

agreed, but I want the real value as that would mean an even lower LTV, meaning better interest rates on offer.

gary77

iTrader: (1)

The mortgage lender will lend you money up to the value of the property , the lender will value the property before giving any money or you can get the property valued by a company that the lender is willing to accept

What you paid for it has nothing to do with the value of the property ,

97TURBO

i have spoken to our Lender Nationwide and they are being dicks about. They are saying unless I have added an extension/conservatory/garage conversion then they dont need/want to re-value the property.
Im going to see a "Fee free" Broker on Tuesday as it looks like i'll need to go elsewhere.

gary77

iTrader: (1)

When you bought the house was there not a home report with the value on it , that's how it's done in Scotland just now , the seller has to have a home report done the value of the property is on that , the lenders won't give more than the value on it ,

Did you buy it at auction ? There may be an early settlement fee with your current lender also

MATT93

Oh, I didn't understand what you meant at first though I would assume they would do a current valuation on the property before actually giving you the money.

The house could have been badly damaged since your last valuation for all they know.

EddScott

IMO it should be on market value, not what you paid for it - IF it's a re-mortgage.

For instance, I re-mortgaged and just squeezed 65% LTV so I got the lower rate - I knew the surveyor and chatted him up a bit - as you do

I wouldn't have got the better rate had the mortgage been on the purchase price 2 years ago.


Similar, have just bought another BTL (evil landlord and all that....) when I re-mortgage that it will be on market value as decided by a surveyor - even though I paid a good deal under asking as it was off a "sort of" relative.

mart360

We've remortgaged our place 3 times now,

The last time was last Dec, and im over 50 lol

the first time was easy, no pay slips,as i bank with our mortgage co, so they see the funds coming in. My other half need 3 slips .

Valuations are done the following way .

Google maps for a quick appraisal.

Drive by if that's not sufficient

Full survey only in the worst case ..


Were at the stage that on a two year remortgage, that that any fees

added for a lower interest rate work out more expensive than a no fee

higher interest rate lol

We were told we have a very large loan, not a mortgage lol

Mart

Devildog

Yes, they should.

In practice, they are lazy b4stards who, for a reportage will often take your purchase price and increase it by effectively the average property price increase in your area. Because you bought a repo and got a better deal, that may well cap the value your existing lender is willing to apply.

gary77

iTrader: (1)

If the house was put on the market it would have to be valued , I don't see why remortgaging is any different , can a property not be valued by the owner himself and then use that when getting a remortgage

markjmd

iTrader: (11)

Can anyone explain why LTV even matters here? The amount the OP wants/needs to borrow will be the amount left to pay on his previous mortgage, surely? Or is it a common thing for people to be asked to put down a second, third or n'th deposit when they remortgage a property?

piehole1983

iTrader: (7)

He might get a better interest rate with a low LTV.

Henrik

iTrader: (5)

Because when lending money, there's always the risk of the money not being paid back.

The higher the LTV, the higher the risk, because e.g if the borrower didn't pay the money back, it's more likely that the oustanding mortgage can not be cleared by repossessing the property and selling it.

Also, the higher the LTV, the more risky any house price falls will be, because the above point.

gary77

iTrader: (1)

...

mart360

Tell em you want to sell not RM,

mention the extensive mods, and they will send out a valuer.


Alternatively contact local estate agents, and tell them you want to sell,

they'll be all over you like a rash,

one valuation later, go back to your mortgage co and wave the paper ...

Alternatively just get a new mortgage co

Mart

97TURBO

I went and seen an IFA on tuesday who knows the area very well, he said we're nailed on to get the true value of the property which is between 35-45k above what we paid. This is going to reduce our monthly payments and also the mortgage term by 3 years, this includes building the early repayment charge into the new mortgage. All round very happy.